Valuation Metrics and What They Indicate
At a price-to-earnings (PE) ratio of 28.47, IIFL Finance is priced significantly above the broader market average and many of its NBFC peers. The price-to-book (P/B) ratio stands at 1.88, suggesting investors are paying nearly twice the book value for the company’s net assets. Enterprise value multiples such as EV to EBIT (12.63) and EV to EBITDA (12.25) further reinforce the premium valuation. These multiples indicate that the market is assigning a relatively high value to the company’s earnings before interest, taxes, depreciation, and amortisation.
Return on capital employed (ROCE) and return on equity (ROE) are moderate at 9.29% and 6.62% respectively, which are respectable but not exceptional figures to justify an extremely...
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